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This study uses data from three decades on three leading indicators to examine the relationship between Ethiopia’s unemployment, GDP, and inflation. The correlation parameters a and b between unemployment and inflation are highly significant (Table 4), implying that the correlation is dynamic (changing over time) (Meloni et al. 2022). Furthermore, as shown in Figure 1, inflation and unemployment have an inverse relationship. This is because more sectors hesitate to act thoroughly on incorporating inflation expectations into nominal wage demands when they experience unemployment (Palley 2012). Simona et al. (2019) also argued that the inflation rate hurts foreign direct investment (FDI), increasing unemployment because FDI flows are widely believed to create new jobs and thus reduce unemployment.

In the unemployment-GDP pair, the correlation parameters a and b (see Table 4) are highly significant, indicating that the correlation is dynamic. Additionally, for every 1% increase in unemployment, GDP growth decreased by roughly 6% in the fitted ARDL (3,3,3) model, controlling for changes in inflation and its lags, the first, second, and third lags of GDP. This is unsurprising given the effects of GDP growth on unemployment (both short- and long-term) (Meloni et al. 2022). Several empirical studies have investigated the relationship between unemployment and GDP. For example, Okun (1962) studied the relationship between unemployment and GDP using the US dataset after the Second World War and found a negative relationship between the two indicators. Most recently, Bein and Ciftcioglu (2017) investigated the relationship between the relative share of agriculture in GDP and the unemployment rate for selected European countries and found that the unemployment rate is negatively related to the relative GDP share of agriculture.

Unemployment affects the unemployed individual and his family, not only with respect to income, but also with respect to health and mortality. Moreover, the effects linger for decades. The effects of unemployment on the economy are equally severe; a 1 percent increase in unemployment reduces the GDP by 2 percent. The criminal consequences of unemployment are mixed; in some circumstances, property-crime rates increase significantly; in other circumstances, there seems to be no effect.

Individual Consequences of Unemployment

But fears of an imminent Chinese attack are misplaced. For decades, China’s policy toward Taiwan has been characterized by strategic patience, as has its approach to other territorial claims and disputes—from India to the South China Sea. Far from spurring China to jettison this approach in favor of an imminent military assault on Taiwan, the war in Ukraine will reinforce Beijing’s commitment to playing the long game. The price Moscow has paid, both militarily and in the form of international isolation, is but a fraction of what China could expect if it were to attempt to take Taiwan by force. Better to wait patiently for Taiwan’s eventual surrender, as Beijing sees it, than to strike now and risk winning the island at too high a cost—or losing it forever. Fear that China will attack Taiwan had been growing well before Putin invaded Ukraine. As Robert Blackwill and Philip Zelikow observed in a 2021 report published by the Council on Foreign Relations, Taiwan is “becoming the most dangerous flash point in the world for a possible war that would involve the United States of America, China, and probably other major powers.” In addition to its historical and economic motives for controlling Taiwan, Beijing feels the need to prevent other powers from using the island as a base to pressure China militarily or subvert it politically. For its part, the United States has strong motives for insisting on what Washington has referred to since 1972 as the “peaceful resolution of the Taiwan issue”—which, given the anti-unification sentiments of the Taiwanese people, means an open-ended and perhaps permanent state of de facto autonomy for the island. Although there is much emotion on both sides—for China, nationalism; for the United States, commitment to democracy—what makes the Taiwan issue truly nonnegotiable are the two countries’ security interests. In 1979, when the United States broke diplomatic relations with Taiwan to normalize relations with China, Beijing had a reasonable chance of winning over Taiwan without using force. Taiwan was diplomatically isolated, militarily weak, and increasingly economically dependent on the mainland. China encouraged this dependence by establishing a host of incentives for Taiwanese enterprises to do business on the mainland, by purchasing Taiwanese exports, and by sending Chinese tourists to the island. Beijing also invested in Taiwanese media with the aim of generating favorable news coverage and held exchanges with leaders of the anti-independence Kuomintang, or Nationalist Party. But these efforts proved insufficient to stem the tide against unification in Taiwanese public opinion and politics. According to opinion polls, the share of Taiwanese voters favoring unification fell from 28 percent in 1999 to less than two percent in 2022. An overwhelming majority favor “maintaining the status quo,” which in the language of Taiwanese politics means sustaining autonomy without formally declaring independence. Since 2016, the anti-unification Democratic Progressive Party has controlled both the presidency and the legislature, and it looks well positioned to win the next set of national elections in 2024. These trends have prompted China to adopt a more threatening posture toward Taiwan. Beijing has stepped up measures to isolate the island diplomatically, slowed imports and the tourist trade, trained the Chinese military to conduct the complicated joint operations necessary for a cross-strait invasion, and conducted frequent probes of Taiwan’s air defense identification zone. China has also developed what the Pentagon calls “anti-access/area denial” capabilities—including long-range precision missiles, submarine-launched torpedoes, antiship ballistic missiles, cybertools, and space capabilities—designed to hold at bay a U.S. defense of Taiwan. These moves have fed speculation that China is building up to a full-scale attack. In addition to Xi’s desire to secure his legacy, the shifting balance of power between China and the United States is often cited by U.S. analysts as a possible motivation for Xi. The scholars Michael Beckley and Hal Brands, for instance, have suggested that China may attack in the near term because it has reached the peak of its national strength—and China’s leaders know it. China is looking at a period of decline caused by a combination of unsustainable debt, rising labor costs, an aging population, declining productivity, and a critical water shortage. Meanwhile, the United States and Taiwan have recently started to readjust their military postures to counter the asymmetric threat China poses. The Biden administration is pulling Japan and South Korea together around a commitment to “stability in the Taiwan Strait,” and Western businesses are gradually moving their production sites out of China because of rising labor costs, lack of a level playing field in the Chinese market, and COVID-19 restrictions. As this reorientation gathers steam, the West’s economic incentives to avoid war with China will diminish. By this logic, Beijing has reason to strike before its adversaries are ready. WAITING GAME The facts on which such forecasts are based are not wrong, but they are incomplete. A fuller set of facts suggests that China is still pursuing a strategy of strategic patience when it comes to Taiwan. First, Chinese leaders—rightly or wrongly—seem confident that they can handle their own problems better than the West can handle its problems. They don’t deny the challenges that Beckley and Brands highlight, but they believe the West is in decline, hobbled by ill-managed and slow-growing economies, social divisions, and weak political leaders. However, Chinese strategists do not seem to believe that China has yet reached a favorable power balance with the West. As Yan Xuetong, dean of the Institute of International Relations at Tsinghua University, has argued, “China’s global reach still has its limits. Despite being a major power, China also thinks of itself as a developing country—and rightly so, considering that its GDP per capita remains far behind those of advanced economies.” Beijing can afford to wait for power in the Western Pacific to tip decisively in its favor. When Washington comes to understand that the cost of defending Taiwan is beyond its means, and Taiwanese officials realize that Washington no longer has the appetite for a clash with China, Taiwan will pragmatically negotiate an arrangement that Beijing can accept. In the meantime, China needs only to deter Taipei and Washington from attempting to lock in formal Taiwanese independence. Beijing’s shows of force are not precursors of an imminent attack, therefore, but measures intended to buy time for history to take its course. Second, contrary to the common portrayal of China as itching for war, Beijing has demonstrated strategic patience in pursuit of its other goals. A good example is Beijing’s behavior in the South China Sea, where China has built and militarized seven sand islands without triggering a war with the United States or rival territorial claimants. It did so by building only on landforms it already controlled, claiming all along that it wasn’t doing what it was doing. The rival territorial claimants were too weak to confront China, while the United States lacked a justification for doing so because it has no territorial claims where China was building. Beijing restricted access to but refrained from seizing a landform it contests with the sole U.S. treaty ally involved in these disputes—the Philippines—which in any case lacked an appetite to invoke its alliance with Washington by moving militarily to defend itself. China likewise changed the strategic status quo without triggering an armed conflict over the contested Senkaku Islands, known in China as the Diaoyu Islands, by escalating from an occasional maritime presence in Japanese waters to a permanent one, supplementing its naval forces with less confrontational coast guard, maritime militia, and fishing vessels. Beijing followed a similar playbook in the contested Ladakh region of India, where Chinese troops gradually advanced their positions and established a series of new lines of control with only one confirmed outbreak of shooting that was quickly contained. China has invested in ostensibly civilian port projects across the Indian Ocean and beyond that could serve as foundations for future naval operations, raising some alarm but no counteraction. Beijing has also used its economic and diplomatic influence in Africa, Europe, Latin America, the Middle East, and Oceania and its norm-setting power in international institutions to incentivize governments to align with China’s interests, again generating some alarm but no effective resistance. Such diplomatic, economic, and military “gray zone tactics” illustrate that China’s strategic behavior is geared toward the long term rather than the short term, moving from no presence to sustained presence in a host of arenas without generating substantial pushback, much less armed conflict (with the exception of the fighting in Ladakh). That same strategic caution has so far been evident in China’s policy toward Taiwan, where Beijing has dialed up tension and deterred a Taiwanese drive for independence without precipitating a crisis. Finally, the lesson Xi is likely drawing from Putin’s war in Ukraine is not that territorial aggression would go unpunished militarily by the West but that it would be both difficult and costly. There is no reason to believe that Xi is surrounded, as Putin seems to be, by yes men who will tell him that a war over Taiwan can be easily won. Even if he is, however, the grinding conflict in Ukraine is reminding him that war is unpredictable and rule over a resisting population is costly. The amphibious operation China would need to undertake to seize Taiwan would be far more difficult than the land invasion Russia has carried out in Ukraine. Xi has been reforming the Chinese military’s command structure and ramping up training for such an operation, but Chinese forces remain untested in actual combat operations. Meanwhile, the chances that the United States would intervene to defend Taiwan have increased as anti-Chinese sentiment has risen in the United States and Europe—and after U.S. President Joe Biden remarked last month that defending Taiwan is “the commitment we made.” Even if Beijing could win a war over Taiwan, it is unclear that it could win what would come next. As painful as Russia’s isolation from Western economies has been for Moscow, the postwar scenario for the Chinese economy would be even more damaging. China imports 70 percent of its oil and 31 percent of its natural gas; it is the world’s largest coal producer but still needs to import more. Although it is striving for food self-sufficiency, China is the world’s largest importer of food, especially corn, meat, seafood, and soybeans. Some of these energy and food imports come from Russia, but many come from countries that would sanction China if it invaded Taiwan. And even if they did not, China’s navy doesn’t have the global reach to defend the shipping routes across which these and many other vital commodities flow. Any war over Taiwan, even a successful one for Beijing, would deal a devastating blow to the Chinese economy, creating conditions that would threaten domestic political stability and usher in the failure, not the realization, of the Chinese dream.

In particular, they have asked us what the likelihood is of Russia invading Estonia, Latvia or Lithuania, and to a lesser degree what the likely knock-on effects are on these countries from a prolonged conflict in Ukraine.

Our top line forecasts for the Baltic states are as follows:

It’s an age-old adage: The Pentagon has said for years that the U.S. Army forces stationed on the Korean Peninsula are ready to “fight tonight” if a war breaks out between North and South Korea—or almost anywhere else. But not everyone in the Army is so sure about that, according to an internal survey obtained by Foreign Policy, especially the grunts who could be doing most of the fighting—and dying.

In a survey of more than 5,400 soldiers and civilians of different ranks conducted by the U.S. Army in July and August 2020, 14 percent of respondents said their unit would be ready to deploy, fight, and win anywhere in the world immediately. Some 13 percent of those surveyed said they would need more time, while 3 percent said they would be ready to go in a week, and 4 percent in a month. Fifty-six percent of those surveyed said the question didn’t apply to them, likely owing to the fact that the majority of respondents were civilians.

How would the system respond? Could the New Peace survive without its policeman? Good counterfactual analysis minimizes the number of both assumptions and alterations of reality. It is also obviously wise to choose relatively simple cases, ones that do not involve many potentially confounding variables. 127 The ramifications of an actual supervolcanic blast would not be contained in the United States; the massive amount of material ejected into the atmosphere would blot out the sun and cause global temperatures to drop for years. To keep this thought experiment manageable, let us imagine a natural disaster that only affects the United States, one resulting in the effective disappearance of U.S. military and political engagement with the rest of the world. The effect of an aloof United States on some regions need not be imagined because it already exists. In South America, the U.S. Southern Command has a minuscule operating budget and no troops to speak of, despite its theoretical “responsibility” for the entire continent. The United States maintains no significant physical presence in Africa or large swaths of Asia. A Yellowstone supereruption would presumably not change security calculations in these areas much at all. Europe would be similarly unaffected, sat least in the short term. The United States currently maintains 95,000 troops from all services in its European Command, none of whom are tasked with maintaining the internal stability of its allies. During the Cold War, U.S. troops did not involve themselves in the domestic conflicts of their host states, unlike their Soviet counterparts. Their job was always to protect Europe from without, not within. The continent is the world’s most stable, its countries the most cooperative, and its people the least martial. It would probably take more than the removal of U.S. troops for ash-cleaning duties to bring back security dilemmas, arms races, and conflict. Borders have hardened, as have norms of conflict resolution. No one can know for sure, of course, but Europe does not seem to be a good candidate for chaos in the absence of the United States. Without the presence of U.S. forces, much of the Middle East would be unstable and chaotic. With the presence of U.S. forces, much of the Middle East is unstable and chaotic. A supervolcano erupting in Wyoming would not have much impact on the security of the world’s most dangerous region. Israel would be just as safe as it was before, since its marked military superiority over all potential rivals is the ultimate guarantor of its security, not U.S. troops or ships. Without the prospect of help from Uncle Sam, the failing governments of Iraq and Libya, as well as the rebels in Syria and our allies in Saudi Arabia, Yemen, Jordan, and elsewhere, would learn to become more self-sufficient. Perhaps they would even make long-term deals with their rivals. It might be good to throw them out of the U.S. nest and encourage them to fly on their own or crash. Fears of a resurgent Iran would be articulated by the usual suspects, no doubt, but both history and the realities of power suggest Tehran would find it hard to dominate its neighbors, even if it had the will to do so. The regions that would be of most concern in such a scenario would be the peripheries of those once and potentially future great powers, Russia and China. To believers in the “deterrence model,” first described by Robert Jervis four decades ago, weakness is provocative, and the post-U.S. world would seem everywhere weak. 128 Moscow and Beijing would attempt to expand their influence, and ultimately perhaps their borders, once they were assured that they would face no pushback from Washington. Perhaps gradual interference in their near-abroads, such as we have already seen in eastern Ukraine, northern Georgia, and the South China Sea, would occur with increasing frequency in the vacuum left by a U.S. withdrawal. While such expansion cannot be ruled out, especially in the long run, large border adjustments would probably not occur in the absence of U.S. power, for least two reasons. First, the removal of American troops would not alter the calculations regarding the costs and benefits of conquest in the twenty-first century. Although absorbing neighbors sometimes paid substantial dividends in the pre–information age, today territory is unrelated to wealth. 129 The people of larger states are not automatically better off than those of small ones. India is not richer than Singapore; Russia would not benefit from invading Ukraine; China would hardly be materially better off if it ruled Taiwan. The other members of the international system might not be able to stop such adventurism militarily, but they can certainly punish it economically. The costs related to invasion and the inevitable problems that arise during occupation would outweigh any possible benefits that may accrue. Conquest in a trading system is profoundly irrational, and the incentives for peace are strong.

Rational calculations are not the only motivations for cross-border violence. As Norman Angell argued a century ago, people have to believe that war is not worth the cost before they will forswear it. 130 The quest for glory and prestige has sent many an army into motion over the centuries; Alfred Thayer Mahan responded to Angell’s rationalism a century ago by pointing out that “nations are under no illusion as to the unprofitableness of war itself” but honor often compels them to fight anyway. 131 By 2017, however, those calculations have changed. It is not at all clear that glory still automatically accompanies conquest. The second reason to believe that Russia and China might not dominate their near-abroads in an essentially U.S.-free world is that the behavioral norms of the New Peace discourage aggression. Imperialism invites opprobrium, not admiration. This does not mean that such assaults could not happen—Genghis Khan was unconcerned about opprobrium, for instance, and Vladimir Putin might be too—but surely it is significant that conquest has been all but absent since the Second World War. The unipole is not the only thing restraining potential combatants; both their material and reputational interests do so as well. If and when a catastrophic supervolcanic eruption weakens the United States, other countries would still have substantial interest in maintaining the overlapping network of international economic and political institutions that serve the interests of all members. All would want to see free trade and investment continue unmolested, whether or not the global policeman could punish violators. Most would continue to place some value on international law, human rights, and the UN system. Why any state would want to move backward to a mercantilist time of pure self-help and violence would be difficult to imagine. It is 2017, not 1717. Volcanologists assure us that someday Yellowstone will awaken with terrifying fury. The human and material cost will be immense, but the ramifications for international security may not be as dramatic. While it might take that kind of event to settle the questions concerning hegemonic-stability theory once and for all, we can still use our imaginations to anticipate the kind of reaction that the system would have if the global 911 is taken off the hook. Even more decisively than a Trump superpresidency, a supervolcano eruption would test the New Peace and settle forever debates over the importance of unipolarity. Until then, one can only imagine what the system would be like without the United States. And the smart money would be with those who say that it would probably look pretty much the same, with very small amounts of conflict and warfare, even if few people seem to notice. In the end, what can be definitely said about the relationship between U.S. power and international stability? Probably not much that will satisfy partisans. The pacifying virtue of U.S. hegemony will remain largely an article of faith in some circles in the policy world. Like most beliefs, it will resist alteration by logic and evidence. Beliefs rarely change, so debates rarely end. For those not yet fully converted, however, perhaps it will be significant that corroborating evidence for the relationship is extremely hard to identify. If indeed hegemonic stability exists, it does so without leaving much of a trace. Neither Washington’s spending, nor its interventions, nor its overall grand strategy seem to matter much to the levels of armed conflict around the world (apart from those wars that Uncle Sam starts). The empirical record does not contain much support for the notion that unipolarity and the New Peace are related. At the same time, three common psychological phenomena suggest that hegemonic stability is particularly susceptible to misperception. U.S. leaders probably exaggerate the degree to which their power matters. Researchers will need to look elsewhere to explain why the world has entered the most peaceful period in its history.

The most frequently cited factor affecting military recruiting is the strength of the U.S. job market. Indeed, the joint force is subject to the laws of labor supply and demand just like any other large organization. Yet, some of our deepest challenges are chronic, indicating that the strength of the economy may be less critical than commonly thought. For example, the Marine Corps has struggled—in good economic times and bad—to produce and retain an adequate number of pilots, even for the newest, most modern aircraft. These struggles have persisted despite ever-increasing bonuses—further evidence that the decision to join or separate is not purely economic. The Air Force has faced similar difficulties, but on a much larger scale.

Recruiting has also suffered from declining trust in the military. A Gallup poll and a 2022 National Defense Survey find a drop in public confidence in the military in recent years. The later survey finds less than half (48 percent) of Americans have a “great deal” of confidence in the US military, a sharp drop from 70 percent in 2018. The survey also found the public lost confidence in the military because of “Military leadership becoming overly politicized” (34 percent); “So-called ‘woke’ practices undermining military effectiveness” (30 percent); and “So-called far-right or extremist individuals serving in the military” (23 percent).

There’s no doubt that politicization is undermining recruiting. Some Democrats have condemned the military for alleged racism, extremism (which they link to Republicans), and resistance to new diversity initiatives. Some Republicans say reports of such problems are exaggerated, that the new diversity initiatives aren’t based on proven effectiveness, and that “wokeness” detracts from military readiness. What’s clear is that special interest groups have used political pressure to promote their own agendas, often under the guise of “improving military readiness.” The tactic is to accuse the military of wrongdoing, implying guilt exists, and then demand a change.

3.) Many factors contribute to the military’s recruiting troubles. The percentage of Americans of service age who are eligible to serve in the armed forces is the lowest it’s ever been. It dropped from 29 percent in recent years to 23 percent last year. Fewer young Americans meet the military basic fitness standards, and more young Americans have used drugs. While marijuana is legal in twenty-one states plus the District of Columbia, its use is still disqualifying when it comes to joining the military. The decline in the percentage of Americans eligible to serve in the military has become accompanied by a declining interest in service. Just 9 percent of Americans of service age say they want to serve, down from 23 percent a few years ago. A mix of factors looks to be a work. A robust job market reduces the economic incentive to join the military. The political right has raised concerns of “wokeism,” while the political left has raised concerns about far-right extremism among service members. And the military’s well-documented problems in curbing sexual harassment and assault, epitomized by the murder of Army solider Vanessa Guillén, has likely discouraged many young women from wanting to join the military.

Something scary happened last week, something that could escalate quickly into a world war. A train from Moscow to the Russian enclave of Kaliningrad was banned at the border by the Lithuanian authorities because it was carrying goods which are now sanctioned due to Russia’s invasion of Ukraine. An angry Kremlin, claiming that the EU was blockading its enclave, issued a statement that Moscow would respond in such a way that “citizens of the Baltic State would feel the pain”. Nikolai Patrushev, a former KGB spy, who is now the secretary of Russia’s Security Council and a favourite to succeed President Vladimir Putin, said Lithuania’s “hostile” actions showed that Russia could not trust the West, which he said had broken written agreements over Kaliningrad. Lithuania’s Prime Minister Ingrida Simonyte hit back by saying that there was no blockade as people and most goods could easily travel as normal. Her country was simply applying agreed EU sanctions on Russia. She added that it was “ironic” to hear rhetoric about allegations of violations of international treaties from a country which has violated possibly every international treaty. Diplomatic temperatures soared. Moscow’s problem is that after the Soviet Union broke apart in 1991, its enclave of Kaliningrad, previously called Konigsberg, an area of Germany captured by Soviet troops during World War II, found itself surrounded by two countries, Lithuania and Poland, which soon became part of NATO and the European Union. The enclave of one million Russian citizens could then only be supplied by air or by sea from St Petersburg. In July 2003, Russia signed an agreement with Lithuania that allowed its citizens and goods to travel to Kaliningrad using the train that ran from Moscow through Belarus and Lithuania. For ordinary Russians it was initially difficult to accept that they needed a transit visa to travel from one part of Russia to another, and some considered it a national humiliation. Nevertheless, until 17 June, when European sanctions started, covering a wide list from coal, metals, construction materials and advanced technology, likely to affect between 40%-50% of all imports to the enclave, the system worked well without any problems.

As expected, Russia’s foreign ministry summoned Lithuania’s charge d’affairs in Moscow to protest against the “provocative” and “openly hostile” measures. “If cargo transit between the Kaliningrad region and the rest of the Russian Federation via Lithuania is not fully restored in the near future”, said Russia’s foreign ministry, “then Russia reserves the right to take any actions to protect its national interests”. It’s not yet clear what the actions might be to protect the interests of Kaliningrad, a key location on the shores of the Baltic Sea, the base of Russia’s Baltic Fleet where Moscow has already deployed nuclear-capable Iskander missiles.

Yet a series of reports by the nonpartisan RAND Corporation shows that the possibility of nuclear escalation in a conflict between the North Atlantic Treaty Organization and Russia over the Baltic region is higher than one might imagine. The best way of averting it? Invest more in the alliance’s conventional defense.

There was a time when it seemed quite normal to risk nuclear war over the sanctity of European frontiers. During the Cold War, NATO was outnumbered by Warsaw Pact forces, and it would have had great difficulty stopping a Soviet attack with conventional weapons. From the moment it was formed, NATO relied on the threat of nuclear escalation — whether rapid and spasmodic, or gradual and controlled — to maintain deterrence. American thinkers developed elaborate models and theories of deterrence. US and NATO forces regularly carried out exercises simulating the resort to nuclear weapons to make this strategy credible.

Russia’s invasion of Ukraine has raised the specter of nuclear war, as Russian President Vladimir Putin has placed his nuclear forces at an elevated state of alert and has warned that any effort by outside parties to interfere in the war would result in “consequences you have never seen.” Such saber-rattling has understandably made headlines and drawn notice in Washington. But if China attempted to forcibly invade Taiwan and the United States came to Taipei’s aid, the threat of escalation could outstrip even the current nerve-wracking situation in Europe.

A recent war game, conducted by the Center for a New American Security in conjunction with the NBC program “Meet the Press,” demonstrated just how quickly such a conflict could escalate. The game posited a fictional crisis set in 2027, with the aim of examining how the United States and China might act under a certain set of conditions. The game demonstrated that China’s military modernization and expansion of its nuclear arsenal—not to mention the importance Beijing places on unification with Taiwan—mean that, in the real world, a fight between China and the United States could very well go nuclear.

In the decades following the atomic bombings of Hiroshima and Nagasaki in 1945 that killed an estimated 120,000 people instantly, global nuclear arsenal swelled to a frighteningly dangerous level. Today, we are living in perpetual fear of ever-powerful nuclear weapons in the armoury of the US, Russia and China, hanging over our heads like the Sword of Damocles.

Our anxiety level about a nuclear war reached a new height after Russian President Vladimir Putin threatened to use nuclear weapons in Ukraine. However, most nuclear experts believe that the likelihood of Russia actually using a nuclear weapon in the Ukraine war is still relatively low. Regardless, given Putin's current predicament, his public statements and recent drills of Russian defence forces practising the delivery of a massive nuclear strike, the threat is seen as increasing.

Also, Adm. Charles Richard, head of U.S. Strategic Command, warned in February: "There is a real possibility that a regional crisis with Russia or China could escalate quickly to a conflict involving nuclear weapons, if they perceived a conventional loss would threaten the regime or state."

Integrated deterrence is, at its heart, about shaping behavior to “convince potential adversaries that the costs of their hostile activities far outweigh any possible benefits,” as Defense Secretary Lloyd Austin . Integrated deterrence ultimately relies on a full spectrum of incentives, disincentives, messaging, and negotiation, underwritten by credible deterrents of conventional and/or strategic military action. Unsurprisingly, a good amount of the spectrum below the threshold of active armed conflict will reside in the .

The United States must react to adversarial activity in the gray zone, especially in areas that adversaries perceive as important, to reduce their efficacy; that will require responses that are appropriate, proportionate, and effective. Equally important, the United States must engage proactively in the gray zone to shape competitors’ behavior. Some of the capabilities needed for engaging in the gray zone exist within the DOD, with many housed within US Special Operations Forces , as well as theater security cooperation activities and those at a national level that transcend a single geographic combatant command such as coordination with Five Eyes partners (Australia, Canada, New Zealand, and the United Kingdom) across the globe. Other capabilities, while not organic to the department, are at its disposal through effective partnerships with the intelligence community, other departments (e.g. State, Treasury, and Commerce), and alliances and partnerships. Improving the way the DOD leverages partnerships can potentially result in better outcomes than replicating the partners’ capabilities.

The U.S. military also responds to humanitarian crises, including the recent hurricanes that devastated Puerto Rico. Responding to such emergencies is expected to become more challenging as climate change contributes to more natural disasters, potentially sparking international conflicts over fresh water, food and other resources.14 Defense spending in recent years peaked in fiscal 2010 at $691 billion, and Trump's proposal would not bring it up to that level. Some of the country's potential adversaries, meanwhile, have stepped up their military outlays and activities.15 China's defense spending increased 26 percent between 2013 and 2016. In addition, since 2014, China has built 3,200 acres of military bases on artificial islands in the South China Sea that U.S. officials say are part of Beijing's plan to dominate Asia.16 Russia's military also has become increasingly aggressive, raising alarms among NATO countries in Europe that the United States is pledged to protect under Article 5 of the organization's charter. In September, Russia conducted its largest military exercise in recent history in an area that included the Arctic, the Far East, the Black Sea and Russia's border with Ukraine. The exercise involved tens of thousands of troops, along with warships, submarines, fighter jets, helicopters, tanks, artillery, anti-ship missiles, intercontinental ballistic missiles and swarms of drones.17 Another U.S. foe, Iran, says it has increased domestic weapons production 69 percent in the last three years. In January, it conducted its 10th ballistic missile test in two years, raising concerns that it had violated a 2015 agreement with the United States and other world powers to limit its nuclear program in exchange for relief from economic sanctions. According to military reports, 36 U.S. military bases overseas are within range of Iran's missiles.18 Joint Chiefs Chairman Dunford last year identified Russia, China, Iran and North Korea, along with Islamic extremism, as the country's top military threats.19 But none of those countries matches the United States in military might, analysts say. China, for example, is at low manpower levels, and troops have not faced sustained combat since the Vietnam War and are weak on training, coordination and logistics, according to the Congressional Research Service (CRS), the research arm of Congress.20 As the debate about U.S. military readiness continues, here are some of the questions that policymakers and defense experts are asking: Is the U.S. military too small? President Trump announced in January that he wanted to oversee “a great rebuilding” of the U.S. military, detailing plans for 540,000 Army troops, 350 Navy ships and a modernized nuclear arsenal. Pentagon officials and congressional Republicans praised the proposal, although they said it could take years to rebuild the military to something close to Cold War levels, when the Army had more than 750,000 active-duty troops. That number decreased to about 480,000 during the 1990s, rose after the 2001 terrorist attacks and dropped again beginning in 2011. The Army had 475,000 troops on active duty in fiscal 2016.21 As troop numbers have declined, however, their quality has improved, said Steven Kosiak, an adjunct senior fellow at the Center for a New American Security. Higher spending on military health care and veterans’ benefits has attracted more high-quality recruits as measured by “education, aptitude and level of experience,” he said.22 But demands on U.S. soldiers are increasing, which means troop strength also should increase, some defense experts say. Since the end of the Cold War, “the range of potential conflicts we have to be ready for has grown exponentially,” says Todd Harrison, director of defense budget analysis at the Center for Strategic and International Studies, a Washington think tank that researches national security and other issues. In addition to conducting counterterrorism operations, today's soldiers must be ready to fight “old-fashioned” conventional wars in places such as North Korea, while also preparing for a potential cyberwar, says James F. Cunningham, a former senior research associate at the American Enterprise Institute, a conservative think tank in Washington. Yet keeping a full brigade trained and ready is difficult when troops constantly rotate out for home leave or are lost through attrition, Cunningham says. “What we have right now is not sufficient,” he says. Dan Goure, senior vice president of the Lexington Institute, a conservative think tank in Virginia focused on national security and other issues, said today's military “is too small, with too few technological advantages and facing too many threats.” “There is now a very real possibility that in a future conflict … U.S. forces could suffer such high casualties that regardless of the outcome, this country will lack the capabilities needed to deal with any other major contingency,” Goure said.23

Army leaders said very few say they are deterred from enlisting due to “wokeness.” In fact, concerns about discrimination against women and minorities is seen as a bigger issue, along with a more general distrust of the military.

“Wokeness” is a slang term that originally described attentiveness to issues of racial and social justice. Some people and groups, especially conservatives, now use it in a derogatory sense implying what they see as overreactions.

This paper examines the effect of local labor market conditions on military enlistment in several new dimensions. First, my results for high quality contracts using OLS specifications and the unemployment rate as the measure of labor market conditions (the focus of existing research) are largely consistent with previous literature.83

Using the results in Crow (2019) that indicate it is possible to identify the effect of labor market conditions on low quality contracts, I extend the research on labor market conditions and enlistment beyond high-quality contracts to all contracts, the differential effects on high vs. low-quality individuals, and more importantly, to the much broader population of military applicants. I also use the employment-to-population ratio as a more accurate measure of labor market conditions and provide the first plausibly causal estimates for the effect of local labor market conditions on enlistment.

Let me move on to another data question. Do you have data on the relationship between the unemployment rate nationally and recruiting? We're now in one of the tightest labor markets I've ever seen in my lifetime. Every -- everybody that comes to my office, their number one issue is -- is workers. This morning I had loggers from Maine, truck drivers, plumbers, doctors, nurses, retail, so I'm interested.

Intuitively, it seems to me that your -- your job is going to be tougher when the labor market is so tight and there's so many other opportunities. Is there any data on that Secretary Raven, do you know?

A solid labor market has clearly hurt recruiting. Historically, the military faces greater recruiting challenges when the unemployment rate is low, as it is now. COVID worsened the problem. Military recruiting is recovering from two years of shutdowns and isolation, in which recruiters lost in-person access to prospects at schools, public events, and military-focused youth organizations such as the Sea Cadets and JROTC programs. Virtual recruiting was less effective, and recruiters have found recovery in many in-person venues slow.